South Africa's property sector is worth R4.9 trillion and R3 trillion of that is residential, according to a new study by the Property Sector Charter Council.

The Charter Council commissioned research in a first study of its kind in SA to discover the size of the country's property sector.

Chief executive Portia Tau-Sekati said the research created a hub of knowledge about the property sector, consolidating information and developing a common understanding.

"By determining the size of the South African property sector, we are moving towards a proper baseline measure to assess market size and its components, the scale of different services and activities within the sector and ultimately BEE transformation figures in line with the Property Sector Code scorecard," said Tau-Sekati.

The figures in the study reflect the status in the property sector taken in December 2010 and show that only about one percent of land in SA is urban and residential. More than 73 percent is natural pasture, around 12 percent of land is agricultural and about the same portion comprises nature reserves.

The study shows nearly two thirds of property owned in SA is residential, estimated at R3 trillion.

Commercial property carries a value of about R780 billion and undeveloped land zoned for development equates to R520bn. Publicly owned property, including national, provincial and local government as well as state-owned enterprise, totals about R570bn.

The research combined various studies that estimate the size of SA's residential market. While the number of housing units, both formal and informal, vary, from 13.1 million dwellings to eight million, value calculations are all estimated at similar levels of R3 trillion.

Of the R780bn worth of commercial property in SA, corporate property accounts for R600bn, including investment property of R120bn held by the country's listed property sector. Further investment property held by life and pension funds and private equity funds totals R180bn.

Retail property held the highest value of the commercial property sectors at R340bn, followed by office properties at R228bn and industrial properties at R187bn.

For publicly owned property, the study used available information which reflects R342bn of property held by provincial government, R188bn by national government, R37bn by local government and R6bn by state-owned enterprises.

"Besides being a benchmark to monitor and evaluate the progress of transformation of the sector each year. This study marks the beginning of an ongoing research process, which will update information on the property sector annually."

Property analyst at Absa Home Loans Jacques du Toit said house price growth in SA was relatively low compared with a few years ago. This was impacted by various economic factors influencing consumers' finances and confidence, with the result that supply exceeded demand.

"In view of these trends it is probably not a bad time to invest in property, but it should be kept in mind that capital appreciation will be a gradual process over the next few years, with an investment horizon ideally not less than five years," said Du Toit.

Economic growth, employment, inflation, interest rates, household income and debt, the state of consumer credit records and consumer confidence will remain key factors to the housing market, he said.

"These factors will impact the affordability of property and accessibility of mortgage finance against the background of trends in property prices, property running costs, financing and transaction costs and banks' lending criteria.

"As a result, the housing market is forecast to continue to show a relatively subdued performance in respect of price growth for the rest of 2012 and in 2013. Based on Absa's calculations, house prices are forecast to continue to deflate in real terms over the next 6 to 18 months, which will be the result of trends in nominal prices and headline consumer price inflation during this period."

But Laurie Wener, managing director for Pam Golding Properties, Western Cape, said from a property perspective, SA had fared relatively well when compared with global markets.

He said the residential property market remained resilient and market sentiment had improved.

"Those buyers who were sitting out the challenging economic conditions are tending to make purchase decisions, particularly while there are still good buys to be had and good value available, offering the potential for sound investment returns in the medium to long term," said Wener.

Seeff chairman Samuel Seeff said that although about 90 percent of SA buyers were ordinary residential buyers who were not buying homes as investments but rather a home to live in, property was arguably one of the best wealth-creation tools.

"In comparison to other asset classes where there is always an inherent risk of capital loss, you don't lose your capital in property. Provided you buy right, it is almost impossible to make a really bad property investment."